I’m 41, married with three kids under age 7. I own my house, car, etc., and have no debt. I have $150,000 in a bank business account, $200,000 in a bank savings account and $110,000 in retirement accounts. These types of retirement accounts have changed as my business has evolved. My business is service-oriented and requires little money to operate. I typically earn about $140,000 per year.

After reading your books, I want to keep things simple. I plan on moving my money to Vanguard and keeping a small amount in a bank checking account. Do I take some of my business account money and invest it? Should I take a large portion of my savings account and invest in other funds? I was thinking of moving my retirement money to index funds and bonds: 42 percent Vanguard Total Stock Market Index, 33 percent Vanguard International Stock Index and 25 percent Vanguard Wellington.

I have concerns with bonds, since interest rates probably will go up. Should I be concerned with doing any of the above in December because of dividend payments? I plan on trying to max out my retirement from here forward. I have so much in cash because of not trusting the people giving me financial advice and not having the knowledge. So I’ve been sitting on my money, and it bothers me every day.

Answer: I have often said that it generally is better to keep your money some place safe than it is to barge ahead with an investment you don’t understand or feel comfortable with. You don’t want to quickly lose the money that you worked so hard for. That said, if your money that you’re investing is growing too slowly, you may fail to accomplish your personal and financial goals.

Clearly, you haven’t felt comfortable investing your large amount of savings for growth purposes, because you’ve left that money in bank accounts where the return you’re earning isn’t enough to keep up with inflation and taxes. Now that you’ve done some reading and learning about investing, you are growing more comfortable.

I like your fund investing ideas for your retirement money. Investing 85 percent in stock funds is quite aggressive for your age and experience level with investing, so be sure that you understand the volatility that such a portfolio may experience. You might aim to invest no more than 75 percent in stocks. Inside of retirement accounts, you need not be concerned with December or any other fund distributions.

Now, investing the excess money in your bank accounts will require you to do some thinking. Specifically, you should develop an overall financial plan and establish your personal and financial goals.

Once you have goals, you can match money you’ve saved to specific goals. The time frame of those goals should shape the riskiness of the investments that you choose to accomplish for each one. For example, perhaps you plan to earmark the money in your savings account for retirement. Having a goal with such a long time horizon would enable you to choose a riskier mix of investments because you’ve got the time to wait out volatility.

With the money in your business account, you should determine how much you wish to keep there for a cushion or emergency purposes. Also, be sure that there are no tax consequences to you of moving that excess money out of that account (this could typically occur if your business were incorporated).

When investing a lump sum of money that you have sitting currently in cash, especially if you’re a skittish investor, I recommend that you consider doing so gradually — known as dollar-cost averaging — over time. You could invest the desired chunk of money, say, once per quarter throughout the next 12 to 18 months. I would invest each portion early in each calendar quarter, as taxable distributions tend to be made late each quarter.

The idea behind DCA is to invest the money gradually so that in case the stock market falls sharply, you may still have some cash left to invest at lower prices. Of course, in order for this to happen, you must make a plan and investing schedule and then stick to it. Fearful investors tend to want to back off of their investing plans once the market drops significantly.

Posting a comment to our website allows you to join in on the conversation. Share your story and unique perspective with members of the azcentral.com community.

Comments posted via facebook:

► Join the Discussion

Join the conversation! To comment on azcentral.com, you must be logged into an active personal account on Facebook. You are responsible for your comments and abuse of this privilege will not be tolerated. We reserve the right, without warning or notification, to remove comments and block users judged to violate our Terms of Service and Rules of Engagement. Facebook comments FAQ

Join thousands of azcentral.com fans on Facebook and get the day's most popular and talked-about Valley news, sports, entertainment and more - right in your newsfeed. You'll see what others are saying about the hot topics of the day.